Shiba Inu (SHIB) has experienced a sharp technical rebound after reaching deeply oversold levels on the Relative Strength Index (RSI). This movement has put a halt to a persistent downtrend that had pushed the meme token towards multimonth lows, consequently raising concerns among traders who were observing weakening momentum across multiple timeframes.
The oversold reading on the RSI signaled a potential capitulation phase, which in turn prompted buyers to step in as the selling pressure began to cool. This shift indicated that the bears were losing their momentum, thereby triggering a short-term recovery attempt for the token.
Downtrend Remains Intact as Major Moving Averages Hold Above Price
Despite the recent bounce, SHIB continues to trade below its 50-day, 100-day, and 200-day moving averages. This technical structure suggests that the broader trend remains in bearish territory. Market observers have noted that the token’s current bounce appears to be driven by technical triggers rather than any significant improvement in overall market sentiment.
It is noteworthy that the trading volume has remained steady throughout the downturn. This consistency indicates that the decline was more indicative of controlled profit-taking and gradual unwinding of positions, rather than panic-driven exits from the market.
Analysts have also highlighted that the current rebound aligns with a slowdown in downside momentum. Traders are now closely monitoring the market for stronger trend-reversal signals before considering positions for a longer-term upside move.
Key Recovery Zone Emerges as SHIB Tests Trend Boundaries
Should SHIB manage to extend its current bounce, it may attempt a move towards the $0.0000095–$0.000010 price region. This area is significant as it aligns with the 20-day and 50-day moving averages and currently represents a critical resistance zone.
A rejection from this resistance level would strongly indicate that the current rebound is temporary and remains confined within the broader downtrend.
Conversely, maintaining stability above the $0.0000080 level would suggest a significant easing of selling pressure. A period of reduced volatility within this zone could signal early accumulation, a pattern that often precedes medium-term recoveries, although such developments tend to occur slowly.
Downside Risk Still Present Despite Strengthening Buy Volume
A potential breakdown remains a possibility if the current bounce loses its momentum. A decisive close below recent lows could lead to SHIB testing the $0.0000070 liquidity pocket, thereby reopening the door to renewed bearish pressure.
However, analysts generally view this scenario as less likely in the immediate term, primarily due to the consistent buy volume that has accompanied the current rebound.
Market Watches for Confirmation of a Sustained Recovery
SHIB’s technical bounce has successfully revived interest across the market. Traders are now closely monitoring whether this momentum can evolve into a broader trend shift.
The upcoming trading sessions will be critical as SHIB navigates these key resistance and support zones. The outcome of these movements will ultimately determine the viability of a sustained recovery or a potential return to its downward trajectory.